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07/03/2016

CEE sells Zwickau Süd biomass CHP plant at a profit

Hamburg, 07 March 2016 – CEE, the private equity company in the Hamburg-based Lampe Equity Management Group, will gradually sell its 60% majority stake in the CHP plant Zwickau Süd GmbH & Co. KG to the current minority shareholders Zwickauer Energie Versorgung GmbH (ZEV). The parties have agreed not to disclose the price.

The return earned by CEE on the exit is well in excess of what was originally expected. “We are very satisfied with the exit scenario in Zwickau – especially in the context of the fiercely competitive biomass market,“ underscores Detlef Schreiber, CEE’s CEO.

The agreement put out to tender to supply Zwickau with heat was acquired by CEE in 2011 from the project planner, developed further and finalised. Thanks to its know-how in structuring other biomass project transactions acquired over many years and close monitoring of all contracting parties, CEE constructed the CHP plant on schedule and on budget. The total investment amounted to about EUR 25 million.

“In our view, further factors that contributed to the success of the project were the long-standing and close collaboration with ZEW, which has marked the project from the tender up until today,” emphasises Schreiber. Thanks to the extensive expertise and good contacts of CEE’s experts, it was possible to structure production conditions and agreements very profitably despite falling tariffs under the Renewable Energies Act (EEG).

The biomass CHP plant was completed in 2012 and supplies heat to 10,000 households in Zwickau and electricity to 12,000 households. Compared to conventional energy production, the use of environmentally friendly biomass saves about 51,000 tons of CO2 a year.

The disposal of Zwickau Süd represents CEE’s second major exit in the biomass segment. The Hamburg company successfully sold the biogas portfolio at the end of 2015.